Malaysian electronics workers abused, not allowed unions, MTUC says
Malaysian Trades Union Congress (MTUC) secretary-general N. Gopal Krishnan told The Malaysian Insider that unlike most other sectors which had national unions to protect workers and ensure they enjoy benefits and privileges, the electronics industry was strongly resistant to the formation of unions and had even sacked workers who attempted to set up unions.
Based on a study funded by the United States Department of Labour, Verite found that abuse of workers' rights was rife in Malaysia's RM241 billion electronics industry. "Workers in the electronics industry have long been discriminated against with regard to their right to form trade unions," Gopal said.
"Without a union to look out for their interests, the workers in the electronics industry are vulnerable to being exploited and victims of questionable labour practices."
"Wages are not paid on time, and overtime, benefits and other payments are not paid according to regulations," Gopal said.
Gopal said there had been attempts by workers to set up a union but they were swiftly terminated by their employers.
"Anyone who initiates a move to form a union has found themselves unemployed as the sector is firmly resistant to the formation of unions," he said.
Gopal questioned the electronic sector’s use of such harsh measures against its workers, pointing out that it is the fundamental right of a worker to form a union, as stated in the Federal Constitution.
After a 20-year struggle to unionise workers in the electronics industry, Putrajaya allowed industrial unions to be set up in the sector, although they would be regional rather than national.
In addition, the Electronic Industry Employees Union covered only workers in Peninsular Malaysia.
Gopal said the electronics industry had challenged the validity of the unions by taking the matter to court but the unions were hampered by a lack of funds.
"To date, only one trade union has successfully been recognised and formed in STMicroelectronics Sdn Bhd in Muar, Johor.
"Recognition is essential, for without it, trade unions cannot enter into collective bargaining agreements with the employer."
Gopal said many electronic companies which supplied major brand names had been using various means to prevent recognition, including terminating worker leaders working towards forming unions.
"Pro-union workers are sacked – something made easier by the existence of short-term employment contracts – by simply not renewing these contracts and getting new workers," said Gopal.
"Nowadays, when many employers use short-term employment contracts, it is easy to get rid of those workers who want to form a trade union."
In its report, Verite did not single out any company but blamed a system in which Putrajaya and industry policies gave recruitment firms increasing control over workers' pay and other conditions.
"These results suggest that forced labour is present in the Malaysian electronics industry in more than isolated incidents, and can indeed be characterised as widespread," the labour rights group said.
Several US companies with operations in Malaysia told Reuters they could not comment before seeing the full report.
An Intel spokesman said most of the chipmaker's 8,200 employees in the country were Malaysian and it did not use contractors, while Flextronics said it had "rigorous" policies to prevent abuse of workers.
Putrajaya did not immediately respond to requests for comment.
Verite’s study comes three months after Malaysia was downgraded to Tier 3 in the US State Department's annual Trafficking in Persons report, which cited a lack of progress in protecting the rights of about four million foreign workers.
The report, based on interviews with 501 workers, found that 28% of employees were in situations of "forced labour", where work is coerced through factors including indebtedness from excessive fees charged by recruiters.
That figure rose to 32% for foreign workers, who are often charged excessive fees that lead to indebtedness.
Verite also found that 73% of workers in the sector showed "some characteristics" of forced labour.
On average, workers in the group’s survey paid RM2,985 to brokers in their home country and in Malaysia as payment for their passage and jobs. Unable to afford a lump sum upfront, more than two-thirds of workers who paid broker fees had to borrow money.
One in five immigrants was working more than the suggested 60 hours of overtime a week – the industry's international standard limit, the group said.
Malaysian law allows employees to clock up to 72 hours of overtime.
The country's laws have been amended in recent years to encourage the growth of recruitment companies that provide workforce services to multinationals, including paying, accommodating and disciplining employees.
"Liability over violations of worker rights is obscured, creating vulnerability on the part of the worker to exploitation and abuse," the group said.
Verite also found workers' passports were often confiscated by recruitment firms, which is illegal in Malaysia. Some firms were found to charge more than US$1,000 for a worker to "borrow" his or her own passport.
Malaysia's electronics and electrical industry accounted for 33% of exports in 2013. In 2011, foreign investment in the sector accounted for US$2.68 billion, or 86.5%, of the total. – September 19, 2014.